2. Video equipment (-2.7%)
Equipment that has been superseded by newer technology generally drops in price, even though it can produce great results. Are you looking for a video cassette player? A disk drive? You can usually get them for a reasonable price – and, most likely, even cheaper next year.
Inasmuch as3. Computer software and accessories (-2.2%)
Many Silicon Valley companies get rich by creating machines and gadgets that work faster and cheaper than their competitors’ machines and gadgets. At the heart of it all is software, which tells these machines and gadgets how to operate. One catch: Many programs, such as those included in Microsoft Office, are now sold on a subscription basis, which means you pay less upfront, but more over time. Basic gadgets, such as broadband routers, keyboards and mice, have become commodities and their prices have plummeted. This category also includes blank storage media, such as USB sticks and CD-ROM discs.
4. Cosmetics, perfumes, bath products, nail preparations and accessories (-0.9%)
Grouping cosmetics and other beauty items into one category is dangerous, in part because a bottle of Evening in Paris perfume has far more appeal than, say, a bottle of Seven Nights in Scranton. Still, in times of high anxiety, makeup and other cosmetics are a relatively cost-effective way to feel a little better, and retailers often go out of their way to avoid price increases. Mask-wearing has also hurt demand for beauty products. Additionally, some well-known brands offer deep discounts to compensate for lost in-store sales.
5. Wireless telephone services (-0.4%)
Even though the US wireless phone market is dominated by three companies – AT&T, Verizon and T-Mobile – competition in the industry has managed to bring prices down a bit. From 1997 to 2022, the cost of wireless service has fallen by 51.9%, an average annual decline of 2.9%. Although the decline has slowed over the past 12 months, it’s still relatively cheaper to have wireless service, and even cheaper if you drop your landline.
John Wagoner covers all financial matters for AARP, from budgeting and taxes to retirement planning and social security. Previously, he was a reporter for Kiplinger’s Personal Finance andUSA todayand has written books on investing and the 2008 financial crisis. WagonnerUSA todayinvestment column ran in dozens of newspapers for 25 years.